Life Insurance Business Continues to Suffer from Low Interest Rates
The western European private insurance market continued to suffer during 2012 from the repercussions of the financial market and sovereign debt crisis. The life insurance branch saw premium volumes decline, while non-life insurance business contracted in the EU periphery countries. Even in countries less affected by the sovereign debt crisis, higher premium revenues were mainly driven by price increases. The Austrian market exhibited by and large the same pattern. Life insurers lost 6.5 percent in premium revenues from the previous year, against an increase of 2.1 percent in the property and accident insurance. With a 3.4 percent plus in premium receipts, private health insurance was the only branch to stay resilient and even raised the number of insured risks by 1.5 percent. Premium revenues overall edged down by 0.9 percent year-on-year, further lowering insurance penetration to 5.3 percent of GDP. Premium revenues in 2013 are expected to stagnate (+0.2 percent). In 2012 Austria's internationally operating insurance companies were able to compensate losses on the domestic market by further expanding in central, eastern and south-eastern Europe.